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Portfolio February 24th, 2016

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This is a breakdown of my portfolio including performance, asset allocation, sector allocation and holdings (1% of portfolio minimum) at the end of the day February 24, 2016.

Performance: includes dividends and exchange to Canadian dollars for U.S. account. 

Here are our returns to date along with the S&P 500 and the Canadian Market represented by ishares EWC  which represents 85% of the large and mid cap stocks in Canada:

2016 year to date Feb 24th  (data from Finviz)                             Average 2012-2015

Portfolio                                      -3.74%                                                             12.93%
S&P 500 (SPY)                          -5.23%                                                              15.03%
Canadian market (EWC)           -1.26%                                                                2.49%

Returns from 2012 to 2015 in the January 15th portfolio.

Asset Allocation:  You will notice allocations continue to be heavy on cash and fixed income. My allocations are attempting to mirror the allocations in the post on managing market risk. I want to have money to invest for a correction so I hold just over 42% cash, fixed income, preferred shares, and another a short etf for the S&P market giving me dry powder from cash fixed income and hedges. This allocation would grow if the market goes down and I would sell the positions to pick up equities selling below what I consider fair value.

One thing to note is I have moved more into the fixed income long term US treasuries ETF (EDV) and it now is 8% of the portfolio. I will likely increase this as long as I feel overall market valuation is high.

Sector Allocation: Technology and Energy are my two heaviest sectors. I am finding lower valuations in these sectors in Apple, Qualcolmm, Corning, Western Digital, Helmerich and Payne along with Transglobe.

I have reduced the number of companies I have in energy and am adding positions to the two high conviction picks I have, Helmerich & Payne (HP) and Transglobe (TGL)

I have sold CNOOC (CEO), Chevron (CVX) and Sasol (SSL).  Helmrich and Payne, and Transglobe  have more cash than debt. In fact Transglobe is trading around it’s Net Current Asset value. Still there is a risk because I do not know when the commodity price will improve but I am buying cheap and hoping the strong balance sheets will help the companies survive. The smallest company is Transglobe (analysis) and the ride has been a wild one. down 25% and up 25% and now down around 25% but I continue to buy more averaging down on weakness. My current buy in price is a little around a third of the tangible book value of the company.

Below are the equity holdings 1% or over in the portfolio. Allocation info is above.

I have sold out on CYD, JNJ, CEO, AGU, CVX to reduce holdings to my highest conviction picks and to reduce the number of equities I have to track. I intend to build positions from 5% to 10% of the portfolio as per my concentrated portfolio strategy.


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